Deloitte, a global company with 200,000+ employees worldwide, set out to

reinvent the way they approach performance reviews after tallying the number
of hours the organization spent on performance management: an
astounding 2 million hours a year. They also discovered that the current rating
system produced data that relied more on the evaluator than it did on the
person being evaluated.

Deloitte did a complete overhaul, reframing the reviews to focus more on

what the leader would do with each team member moving forward rather than
how they would rate them on their past work. They started by identifying new
goals for performance management overall. Here’s what they came up with:

1. Recognize performance.

2. See it clearly.

3. Fuel performance.

Deloitte discovered that they needed to do both without relying on an

innately unreliable rating system of peers. “People may rate other people’s
skills inconsistently, but they are highly consistent when rating their own
feelings and intentions,”

By pivoting the questions they were asking to move away from the skills of the
person being evaluated and toward the feelings and intentions of the person
giving the evaluation, they found that they received more accurate feedback.

Deloitte asks their team leaders to respond to these four future-focused

statements:

1. Given what I know of this person’s performance, and if it were my

money, I would award this person the highest possible compensation

increase and bonus.

 2. Given what I know of this person’s performance, I would always want

him or her on my team.

3. This person is at risk for low performance.

4. This person is ready for promotion today.

Using the answers to these future-focused questions, leaders can directly

move into conversations about promotions, improvements, etc.

The third and final objective naturally became to fuel performance. One way
Deloitte did this was through weekly check-ins with team leaders, which had a
direct effect on performance overall. However, recognizing that team leaders
are very busy, Deloitte puts the onus on the team member to reach out to
their supervisor for the check-ins. Coming full-circle, the team member’s level
of effort and commitment to the check-ins directly impacts their performance.

From pivoting the conversation toward the future rather than the past to
making an effort to fuel performance, Deloitte is just one example of a
company that is at the cutting edge of performance management

Need for change didn’t crystallize until we decided to count things.

Specifically, we tallied the number of hours the organization was spending on
performance management—and found that completing the forms, holding
the meetings, and creating the ratings consumed close to 2 million hours a
year. As we studied how those hours were spent, we realized that many of
them were eaten up by leaders’ discussions behind closed doors about the
outcomes of the process. We wondered if we could somehow shift our
investment of time from talking to ourselves about ratings to talking to our
people about their performance and careers—from a focus on the past to a
focus on the future.

Our next discovery was that assessing someone’s skills produces inconsistent
data.
We’ve defined three objectives at the root of performance management—
to recognize, see, and fuel performance. We have three interlocking rituals to
support them—the annual compensation decision, the quarterly or per-project
performance snapshot, and the weekly check-in. And we’ve shifted from a
batched focus on the past to a continual focus on the future, through regular
evaluations and frequent check-ins. As we’ve tested each element of this
design with ever-larger groups across Deloitte, we’ve seen that the change can
be an evolution over time: Different business units can introduce a strengths
orientation first, then more-frequent conversations, then new ways of
measuring, and finally new software for monitoring performance

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We conducted focus groups across the firm, and, from that feedback—and crystalized
three primary purposes for performance management.
Fueling Performance

From emerging research, we know that an effective way to drive performance is

through conversations. So, we created “check-ins”: frequent, future-focused
conversations about the work. Here, team members and team leaders meet 1:1 to
explore real-time feedback and expectations for the near-term work. It’s how they
align on priorities for what’s coming next, and they do that with a strengths lens. They
discuss how the individual will deliver on these priorities given their unique skills and
strengths, and how the team leader will create opportunities for them to do that.

We called them frequent, but we didn’t mandate a frequency. We left this up to

business leaders to communicate as they saw fit. Today, the majority of our people are
doing them either weekly or biweekly.

We also didn’t require anyone to document anything going into or coming out of a
check-in. We didn’t want anything to stand in the way of the conversation.

We stressed that the logistics of check-ins are not as important as making them a
habit. The tone, nature and content of a check-in should evolve over time, differing
from person to person, engagement to engagement, project phase to project phase, and
week to week. There was no heavy training or how-to guides. To launch check-ins we
did just two things:

 We gave people prompts to spark conversations.

 We began sending out a simple weekly email with a Yes/No voting button and one
question: “Did you have a check-in conversation with your team leader this week?”

What’s interesting, though, is that we didn’t use this data to monitor compliance,
follow up with those who weren’t doing them, or reward those who were. We just
looked at it on aggregate to understand organization-wide check-in behavior and its
impact.
Our people who were used to heavy investments twice per year were now expected to
shift that time to the location where the work—the performance—was happening in
real time. We changed the notion that performance management is that thing you take
time off from the work to do. Currently, check-ins are part of how our people get their
work done.

Seeing Performance
Moving away from ratings didn’t mean we’d stop capturing performance data. For us,
it just meant we’d now capture a different type of data. We designed several
components that enable us to see the performance of our people and teams. I’ll focus
here on just one: the Performance Snapshot.

Fundamentally, a performance management system needs a way to evaluate

performance. What’s more, we know intuitively that the person with the most first-
hand knowledge of someone’s performance is his or her team leader. So, the
Performance Snapshot is a vehicle for the team leader to capture his or her assessment
about each team member’s performance, at a moment in time.

Snapshots are timely, completed at the end of a project, phase, or at least quarterly—
allowing team leaders to capture their judgement of performance as close as possible
to when it occurs. By the end of the year, there are numerous snapshots completed for
each person so that the work our people do ALL year is captured.

Snapshots are research-based. Rather than ask leaders to rate the skills of others,
we’ve crafted questions that ask them to rate their own intended future actions. This
approach counteracts the idiosyncratic rater effect, which research has shown distorts
ratings because the main variable is the evaluator. Leaders in the new system make
decisions based on what they know about a team member’s performance instead of
what they think of the person.

Snapshots are easy. Our Performance Snapshots use four questions, answered on a
Likert-type scale; no more paragraphs to write. We’ve even given folks mobile access
to make these as simple as possible for our on-the-go workforce, to enable an ongoing
flow of data throughout the year.
Recognizing Performance

So now that we’ve got all this data, what do we do with it? In short, the data is
aggregated, and reviewed quarterly to give business leaders a holistic view of
performance in their organizations. Every quarter HR sits down with individual
business leaders to review a scatterplot that plots Performance Snapshot results.

Now, this isn’t the only thing they look at. They also can see who has been flagged at-
risk for low performance, or who has been identified by at least one team leader as
ready for promotion. They also look at important business measures per person, like
revenue.

We ask our business leaders to integrate all of this data to make their own judgements
to drive key talent decisions. See that’s the thing that makes this different from a
single summative rating. In real life there are lots of things we know about people.
When you review a job application, or follow a baseball player, or evaluate your latest
lab results, you consume and integrate several data points to make a set of decisions
about how to act.

With this design, we’re trying to bring that nuanced presentation of a person to Talent
Management. Now, there are lots of things we know about you: we know what your
local team leaders thought they might do based on what they observed of your
performance, and we also know how you’ve performed against your business metric
goals, the activities through which you’ve contributed to the community, and more.
We ask our leaders to take all of it into account when making decisions. Our task in
HR is to find a consumable way to present it. And the task of the leaders is to make
intelligent decisions with it.

So that’s our model. Built on three objectives, with several components, that operate
independently, but also reinforce one another to create an ecosystem of performance.
I’ve only covered two features here, but it also includes:

 Team Pulse survey that provides team leaders with insights about the engagement
of their teams to drive team conversations around how to increase it
 low -performer management approach that, due to the timeliness of the
Snapshots, generates more real-time attention for those at risk
 talent reviews in which panels of leaders plan investments in the career
development of select talent segments
 career coach who helps employees discover their strengths, find more ways to
play to them, explore performance trends across experiences, and develop their
careers.